As doctors and psychiatrists, we have seen the devastating effects of benefit reform on our patients

The next Tory leadership election will be all about class

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At the weekend, Salford City won promotion to the fourth tier of English football. The club’s impressive achievement has generated a disproportionate amount of media attention because the club is owned by six former Manchester United players – Ryan Giggs, Gary and Phil Neville, Nicky Butt, Paul Scholes and David Beckham – dubbed the ‘Class of ‘92’ for starting their careers at United that year. This class of ’92 are widely seen as one of best generations of United players.

But while they went on to excel in their careers, many others who started work in 1992 were not as fortunate. This is because, following a recession the previous year, in 1992 the British economy was in the doldrums and more than one in five people who left education that year found themselves unemployed. The experience of starting their careers in the midst of a downturn would go on to affect the class of ’92 for many years.

Fast forward 17 years and 2009 saw a new cohort of young people stepping out into the world of work. This cohort, like that of 1992, came of age at a bad time. In the wake of the financial crisis, the economy was in turmoil and almost one in four people who left education that year found themselves out of work. For those lucky enough to find employment, about half found themselves working in a low-paying occupation.

How long-lasting these scars have been

For those who can remember 2009, this will not come as a surprise. Unemployment was rising and uncertainty was rife, it was not a great time to be starting your career, and many young people were scarred as a result. What is surprising, though, is how long-lasting these scars have been. New research by the Resolution Foundation looking at the crisis cohort – those who left school, college or university between 2008 and 2011 – finds the effects of the crisis continue to dog the careers of those who came of age in its midst.

People who left school with relatively few qualifications – those educated up to GCSE level – were almost one third more likely to find themselves out of work if they left education during the crisis. What’s more, their employment rates did not recover for a decade, meaning those who left school in 2009 are still feeling the effects today.

Britain has not had a post-recession bounceback

Graduates, on the other hand, face a different set of problems. The vast majority managed to find work, but they were a third more likely to end up in a low-paying occupation than their peers who graduated just before or after them. This has had a really big impact on their career prospects because working in a low-paying occupation doesn’t just mean lower pay today, but also lower pay in future. Why? Because the experience gained in lower-paid jobs does not bring the same financial rewards that a similar amount of experience gained in higher-paid ones does, and so people end up earning less even when they have left these jobs.

‘Over a decade on from the crisis, typical wages for the class of 2009 cohort are lower, in real terms, than for those who left education fourteen years earlier’

This combination of no work, or lower-paid employment means the class of 2009 are still feeling the effects today. In fact, they are earning less than those who left in education in 1995 were at the same stage of their careers. This means that – more than a decade on from the crisis – typical wages for the class of 2009 cohort are lower, in real terms, than for those who left education fourteen years earlier.

Manchester United players aside, 1992 and 2009 were bad years to start your career. Fortunately for those who left education in 1992, the late 1990s were some of the best years we have had in recent decades for pay growth. But Britain has not had a post-recession bounceback since the financial crisis, resulting in lower incomes for most people, not just the class of 2009. This cohort of young people – now in their late 20s and early 30s – are right to feel aggrieved. We can’t let down the next class unlucky enough to come of age during a downturn as we have the last one.

Stephen Clarke is Senior Economic Analyst at the Resoloution Foundation

As doctors and psychiatrists, we have seen the devastating effects of benefit reform on our patients

The next Tory leadership election will be all about class

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